Gov. Wolf’s Pennsylvania Budget Prioritizes Education, Income

Gov. Wolf’s Pennsylvania Budget Prioritizes Education, Income

By: Sara Warden

2 min read February 2020 — Democrat Gov. Tom Wolf focused his 2020-21 budget on education and income, proposing an increase in spending of almost 6% to $34 billion over the fiscal year, including $600 million to cover cost overruns. Republicans criticized the heavy reliance of the budget on the assumption that revenue would grow by 4.5% ($1.6 billion) over the period. The proposals also require borrowing funds. “It’s easy to put things on a credit card and then ask other people in the future to pay for it,” said Republican State Representative Stan Saylor. “That is not the solution for Pennsylvania.”

 1. There will be no major tax increases

Instead of tax increases for citizens, several novel approaches were proposed in the budget to fund services, one of which was a state police fee based on number of incidents and coverage area. Wolf estimates the initiative will bring in $136 million to fund police services. Another way taxes could stay flat is by imposing a tax on the Marcellus Shale natural gas field to be placed in a $4.5 billion infrastructure fund. Based on 2019 production, Wolf believes the tax would generate more than $600 million per year.

Sweeping changes will be made to charter school funding

Wolf proposed a reduction in the obligatory payments school districts must make when one of their students decides to attend a charter school, which would save districts $280 million annually, according to the governor. “Our charter school system is in desperate need of reform,” Wolf said in a sharp rebuke of the charter school system. “It’s time to close the loopholes. It’s time to establish real standards, and it’s time to level the playing field.”

2. Revisiting previous proposals.

The Wolf administration wants the state to increase basic education spending by $100 million and special education by $25 million. He wants all school districts to offer full-day kindergarten, shifting 22,000 students who attend half-day programs into full days. He wants budgets on the whole for Pre-K to be increased by $30 million, most of which will be allocated to the state-run Pre-K Counts program. Finally, he proposed an increase in the state’s minimum teaching salary from $18,500 to $45,000, impacting 3,000 teachers. 

3. Higher minimum wage is high on the agenda

Wolf’s government has always championed higher minimum wages but has been met with stiff resistance. The governor wants to increase Pennsylvania’s minimum wage to $15 per hour on a gradual basis. The current minimum wage is $7.25, which he proposes should be increased to $12 this July and every consecutive year by $0.50 until reaching $15 in 2026.

Another issue the governor addressed was gun reform, which is unusual for a budget speech. Gov. Wolf made an impassioned plea for the state to take gun laws more seriously. “The steps I’m proposing are supported by the evidence and supported by the vast majority of Pennsylvanians,” Wolf said. “To let another session go by without action would be a failure of imagination that will cost lives.”


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Miami Working to Solve Affordable Housing-New Talent Conundrum

Miami Working to Solve Affordable Housing-New Talent Conundrum

Writer: Sara Warden

2 min read September 2019 As business hubs grow, the private sector must attract more talent to the area. But the Catch 22 for the government is that, as more people come, the more neighborhoods gentrify and the less affordable housing is available. Given this reality, how can Miami’s thirst for new talent be maintained? Through inventive new tax incentives, according to the city and state governments.

Since 2012, Miami-Dade’s population has been growing at a steady rate of about 1% per year, but the cost of living in Miami is well above the national average. According to Best Places, which ranks U.S. cities in relation to a national average of 100, Florida scores 110.9 and Miami 137.1. The cost of housing in Miami is by far the biggest expense, coming in at a whopping 174.3 to the US average of 100.

The median home cost in the United States is $219,700, while in Florida it is $225,200 and in Miami the number stands at just over $350,000. But Miami’s GDP is projected to stay strong, with GDP per capita set to increase to $49,293 by 2022 from today’s $48,601 despite a steadily growing population.

One reason for this is the state of Florida’s attractiveness as a workplace. It has a 6% sales tax on items bought, but there is no personal income tax on earnings, although federal income taxes still apply. However, this means that a Floridian earning $30,000 per year would not owe any of this to the state in personal income tax, while a New Yorker earning $30,000 per year would take home around $28,837 per year after paying state income taxes.

Florida’s corporate income tax rate also comes in at the lower end of the scale, especially in comparison to other major cities. At just 5.5%, it is lower than New York at 6.5%, California at 8.84% and Illinois at 9.5%. “Hedge funds and finance firms in places like New York, Chicago and California are feeling the burden of operating in high-tax states,” said Nitin Motwani, managing director of Encore Housing Opportunity Fund, to the New York Post.

This seems to be one reason why billionaire investor Carl Icahn this month announced his company would be moving from New York to Miami. But more than this, over half of his employees decided to move with the company, receiving a $50,000 relocation benefit each.

Icahn’s company will be moving to Magic City, in Little Haiti. As the name would suggest, the area was built on an influx of immigrants and refugees coming from Haiti in the 1970s. Now, with the $1 billion Magic City development, the neighbourhood is gentrifying fast. “Even if Magic City did not come today, the pace of gentrification is so rapid that our people will not be able to afford homes here anyways,” Marleine Bastien, a community organizer, told CNN. “Magic City is not the government. Affordable housing policies have to come from the government.”

Miami’s Mayor Francis Suarez is facing the issue head on. He championed the $400 million Miami Forever bond, designed to make Miami living sustainable. “We actually created in our first tranche of Miami Forever, a sustainability fund for people to renovate their homes so that they can stay in their properties rather than having to sell their properties,” he told CNN. So far $15 million has been allocated to these purposes.

Another development is a public-private partnership between Pinnacle Housing Group and the government to build Caribbean Village in South Miami Heights, which will have 123 units for older residents, with rents ranging from $420 to $1,070 per month. The need for that housing is more acute today than ever, and it’s exciting to be delivering Caribbean Village to the residents of South Miami-Dade County,” said David Deutch, co-founder and partner at Pinnacle, to Miami Today News.

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